St Lucia government finally drops fuel prices

CASTRIES, St Lucia, November 27, 2008 – The St Lucia government has decided to pass savings from the recent drop in fuel prices to consumers.

The decision came against the background of calls for the Stephenson King administration to follow the lead of other regional governments and give citizens relief by reducing fuel prices. In recent months, oil prices have been plummeting, falling below US$50 a barrel last week – the lowest price in three years – after reaching over US$100 earlier this year.

From next Monday, December 1, the cost of gasoline will be EC$1.25 (US$0.46) less, retailing at EC$11.50 (US$4.27) per gallon; diesel will be reduced from EC$12.75 (US$4.74) to EC$12 (US$4.46) per gallon; and an EC$5.10 (US$1.89) drop in cost will see kerosene retail at EC$6.00 (US$2.23) per gallon. Householders will also realise between two and 15 per cent savings in the price of cooking gas, depending on the size of the cylinders.

“To date, the government has resisted what may have been an immediate and premature response to the drop in global oil prices. We sought instead to monitor the situation, whilst exercising prudent management of the government’s finances,” Prime Minister King said in a radio and television address on Tuesday night.

“Government’s ability to implement this year’s budget has been adversely affected by its decision to continue to subsidise fuel, when oil prices were increasing. Government’s revenue has also been eroded by slower than expected economic growth, further exacerbated by the global financial crisis.”

The Prime Minister said the new reductions in fuel prices currently place St Lucia below the Eastern Caribbean Currency Union (ECCU) average, which stood at EC$12.29 (US$4.57) a gallon for gasoline and EC$13.32 (US$4.95) for diesel up to a week ago. He added that the price of diesel here will also be the second lowest in the region.

A government release indicated that it is anticipated that with the reductions in fuel prices, consumers will also benefit further from cheaper costs for other goods and services.

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